A Ford executive said the company has reached a limit on how much it needs to spend to reach a contract agreement with the striking United Auto Workers union.
Kumar Galhotra, president of Ford Blue, the company’s combustion engine business unit, told reporters on Thursday that Ford had gone to great lengths to secure the offers currently being made.
His comments differed sharply from those made by UAW President Sean Fein on Wednesday. Announcing an upgrade Ford’s largest and most profitable plant went on strike to protest the union strike. The apparent widening of labor divisions suggests Ford and the union could be headed for a lengthy strike that could cost the company and workers billions of dollars.
Fein said Wednesday that Ford has been telling UAW negotiators for nearly two weeks that it would make another counteroffer on economic issues. But Fein said the company did not increase its previous offer during a meeting held by the union. “Ford has not received information about fair contract bargaining,” Fein said in announcing the strike for 8,700 workers at the company’s Louisville, Ky., truck plant.
“We’ve been very patient with the company on this,” he said in the video. “They didn’t meet expectations, they didn’t even come to the negotiating table.”
Galhotra called Ford’s offer “very positive” and said Ford never indicated to the union that it would increase its offer.
“We are very aware that we have reached the limit,” he said on a conference call with reporters. “We risk investing in our business and our ability to grow profitably. Profitably growing is in the best interest of everyone at Ford.”
The company has a certain amount of capital but is willing to move dollars in a way that suits the union’s needs, he said, adding that he still thinks a deal is possible.
The escalation comes nearly four weeks after unions began strikes against Ford and Detroit-based peers General Motors and Jeep maker Stellantis. September 15, every company has an assembly plant. The union later added 38 parts warehouses at General Motors and Stellantis, and then three assembly plants at Ford and Stellantis, involving a total of 33,700 workers.
On Thursday, Fein hinted at further action against Strantis.
“Hopefully today’s talks at Stellantis will be more productive than yesterday’s talks at Ford,” Fein wrote on X, formerly Twitter, without revealing what might happen.
A person with direct knowledge of the negotiations said the union met with Strantis Thursday morning and would return in the afternoon for more talks. The person, who spoke on condition of anonymity because he was not authorized to discuss the negotiations, said talks with GM and Stellantis are ongoing but he was not aware of any talks with Ford.
The union has not announced any further job actions so far, although Fein will brief members on film on Friday morning.
Ford’s massive truck plant in Kentucky produces heavy-duty F-Series pickups and large Ford and Lincoln SUVs, the company’s most profitable products. The company says vehicles produced at the plant generate $25 billion in annual revenue, more than Southwest Airlines and Marriott Hotels.
Ford said the expanded strike puts 13 other Ford plants that supply or receive parts at risk, and 600 parts supply companies will also have to lay off workers. In total, the Kentucky Trucking strike affects 100,000 workers, the company said.
The company said many super truck chassis cabs are used to build emergency vehicles such as ambulances. Without the ability to make those products or produce parts, “we’re facing more than just Ford’s bottom line,” said Ted Cannis, chief executive of Ford’s commercial vehicles division.
Last week, the union said overall wages at Ford had risen 23% in four years. The ratio between GM and Stellantis is 20%. But none were tall enough, Fein said.
Anthony Spencer, who has worked at the truck plant for eight years, said the unexpected strike would get Ford’s attention.
“We know this is going to hit them. If we don’t campaign, we’re losing millions of dollars every day,” said Spencer, who is the local union’s recording secretary and helped organize the strike.
“This is a historic moment,” Spencer said on the picket line Thursday morning, adding that locals had not participated in a strike since 1976. “Our guys have been around for 30, 35, 40 years – they’ve never gone on strike. So morale is great.”
He said there were sticking points in the negotiations that led to the strike, including unionization of Ford electric vehicle workers and employee pay increases.
“We all know that if we go electric, we’re going to lose a lot of people who make engines and transmissions, and they have to have somewhere to go,” Spencer said.
CFRA analyst Garrett Nelson wrote in a note to investors that the escalation of Ford’s strike could mean that the strike will continue for a long time “as UAW leadership tries to push for the best labor agreement.”
The move also raises the possibility that the union could soon target other major truck and SUV plants at GM and Stellantis, he wrote.
So far, the union has decided to target a handful of plants at each company rather than have all 146,000 UAW members at the automaker strike at the same time.
last week, Alliance reports on progress During negotiations and decided not to add any more plants. Previously, General Motors agreed to include joint venture electric vehicle battery plants in the national general contract, and it is almost certain that these plants will join the union.
The battery factory has a major point of contention in negotiations. The United Auto Workers wants these plants to unionize to ensure jobs and maximum wages for workers displaced by the industry’s ongoing shift to electric vehicles.
Since the strike began, Detroit’s Big Three automakers have laid off about 4,800 workers at plants not affected by the UAW strike.
Independent companies that make parts for automakers may have laid off workers but may not report them publicly, said Patrick Anderson, CEO of Anderson Economic Group in Lansing, Michigan.
A survey of parts supply companies by an industry association called MEMA Original Equipment Suppliers found that 30% of members have already laid off employees and more than 60% expect to start layoffs in mid-October.
Svlook
